North Fork Bancorp said Thursday that a judge's decision to bar Salomon Smith Barney from acting as its adviser in a hostile takeover attempt of Dime Bancorp would "have no impact" on the outcome of the battle.
John Adam Kanas, chief executive officer of Melville, N.Y.-based North Fork, said in an interview that Dime's success in getting Salomon temporarily blocked as adviser was "consistent with Dime management's behavior - trying to take everyone's eye off the ball."
A New York judge ruled late Wednesday that Salomon, a unit of Citigroup Inc., could not continue to advise North Fork in its $1.9 billion bid for Dime because of a 1997 confidentiality agreement Salomon signed when it agreed to work on Dime's takeover of North American Mortgage Co. That confidentiality agreement expires May 12, but a lawyer for Dime said the judge's decision has the effect of permanently preventing Salomon from advising North Fork.
"This is a real coup," said Dime's attorney, Hyman L. Schaffer. Dime may seek damages from Salomon, including $1.5 million in fees paid for the North American Mortgage transaction. The damages sought could reach an amount equal to the value of Dime itself, he added, if it could be proven that Salomon "did something untoward," Mr. Schaffer said.
A spokeswoman for Salomon said, "We continue to believe that we have completely respected our client agreements." Salomon was expected to appeal the judge's ruling Thursday.
North Fork continues to work with its other adviser, Sandler O'Neill Partners.